Decline in entrepreneurial activity in Scotland halted

A RECENT study has revealed that the number of Scots who were considering starting up their own business in the next three years increased significantly between 2010 and 2011.

The Global Entrepreneurship Monitor (GEM) 2011 survey, carried out by an academic at the University of Strathclyde, revealed that the proportion of Scottish individuals of a working age who expected to start a business in the coming three years increased dramatically from 6.0% to 9.8%.

Despite this, Scottish entrepreneurs are also more likely than their counterparts from the rest of the UK to experience difficulties in finding suitable staff for their new business ventures.

Professor Jonathan Levie conducted the research

The report’s author, Professor Jonathan Levie of the University’s Hunter Centre for Entrepreneurship, said: “It is encouraging that entrepreneurial intention has increased and this could lead to an increase in actual new business creation rates over the next year or two.

“The long, slow decline in early-stage entrepreneurial activity also appears to have been arrested, if not reversed, in 2011.

“However, while there is room for optimism, more needs to be done to turn the intention to start a business into reality. Scottish entrepreneurs still face challenges in getting funding, customers and staff. There is also considerable scepticism across the Scottish public about the wisdom of embarking on an entrepreneurial career, despite the relatively high status afforded to successful entrepreneurs.”

Access to finance is still presenting itself as a problem to many looking to start up in business with half of non-entrepreneurs thinking it would be their biggest barrier and almost half of entrepreneurs citing it as their biggest difficulty.

Sir Tom Hunter, who endowed the Hunter Centre for Entrepreneurship at Strathclyde, said: “The good news is this year’s report indicates there are signs that the decline in early stage entrepreneurial activity has halted. The report shows that the proportion of working-age individuals who intend to start a business has also increased, but if we are to succeed on a global stage, we need to do more.

“In many areas we are no longer lagging behind the rest of the UK. Perhaps some of our initiatives in education are now starting to bear fruit, as founders’ knowledge of how to start in business in Scotland compares favourably to the UK.

“Now we need ambition that avoids or jumps the hurdles, innovation that doesn’t expect Government to provide, or you or me to solve problems. We need entrepreneurs that get on with it.

“GEM Scotland allows us to see where we are, not where we are going. Its up to us to invent where we go next, so let’s get on and do that – self-determining how you intend to build your business is the only way forward.”